Do you know why your customers buy?

If they’re doing their job, SaaS marketers can tell you how many leads they’re attracting, how many convert into paying customers, where the leads are coming from, and even how much they’re paying for them.

That’s all useful information that should be collected in your CRM system.  You can’t run an effective SaaS marketing program without it. 

But all that data doesn’t really answer an important fundamental question underneath the numbers:  Why do your customers buy your solution?

To break that question down into smaller bits:

•  What problem are your customers trying to solve?
• What’s wrong with the solution they had in place before yours?
• How costly or urgent is the problem?
• Why did the solution from you and not some other vendor?

Answers to these questions won’t be found in your CRM or marketing automation solution.

You might make some educated guesses based on particular keyword searches or paper downloads.  But that’s exactly what they are:  guesses.  What someone clicked on doesn’t really reveal why they were looking in the first place.

Ask your customers

I’ll suggest a better approach:  talk with your customers.

In particular, talk with customers that have bought recently.  They can still remember what motivated them to evaluate alternatives to their old solution.  They can give you some useful insights into what problem they were trying to solve.

Who shouldn’t ask?

From what I’ve seen, there are a couple of good options when you think about who should be asking new customers about why they bought.

But first let me point out some bad options:

Customer satisfaction surveys:  These surveys can be measure existing customers’ satisfaction with your solution, but they don’t reveal why they bought the solution to begin with.  I also find that the survey approach can be confining, with little opportunity for customers to raise new issues or elaborate.

Customer support:  When a customer is talking with a support agent, they usually trying to get a problem resolved.  They’re really not inclined to chat about why they bought the solution in the first place.

Sales:  Nearly every time I’ve asked a salesperson why the customer bought, I hear some version of this: “Great relationship with the salesperson!”  That may be true, but not really helpful.  It could explain why the deal was closed, but not why the opportunity opened.

Who should ask?

Having worked with lots of companies that interview new customers, I’ve found that the most useful insights come when either of two people ask the questions.

The marketing team:  Someone from marketing can gather useful insights from customers if they ask as a market researcher.  In other words, they should explain to the customer that they’re gathering feedback to help improve the product and the marketing programs. 

They should explain to the customer that they’re not trying to sell the customer anything.  Instead, it should be clear that they are genuinely interested in better understanding the customer’s evaluation and purchase process. 

Outside marketing analyst:  A second option is to bring in an outsider to conduct the customer interviews and prepare the analysis.  This outside expert has no direct interest is selling the customer anything, and sometimes customers are more forthcoming in speaking to a third party about their experience.  (Shameless plug:  Contact me if you need help.)

It’s not a one-time effort

One more bit of advice:  Talking with new customers shouldn’t be a one & done activity.  Collecting input monthly or at least quarterly can help confirm or refine your insights, or it might reveal a shift in the way customers buy. 

Are you just talking about marketing or are you actually doing something?

Lots of software-as-a-service (SaaS) companies are thinking and talking about marketing.  They’re

sitting in on webinars, downloading white papers, hiring marketing experts and agencies, and even reading newsletters (like what you’re reading right now.)

If they want to grow, the folks that run these companies know they need marketing: a cost-effective program to generate leads, convert the leads into paying customers, and keep those customers.

They can’t rely on their sales team to bring 100% of their opportunities.  Though it may work in the company’s early stages, it’s tough to make that method scale.

So these executives do lots of research, develop comprehensive plans, even engage with marketing professionals to put in place a well-structured customer acquisition and retention plan.

Marketing gets derailed by shorter term priorities

All of this activity is a good start.  But that’s all it is: a good start.  The research, the plans, the experts only matter if you put them to work.

And that’s where things get complicated, especially for smaller firms eager to grow. 

For companies in this spot, their resources are stretched.  There’s simply too much to do and not enough resources to get it done.

So urgent needs take priority, and the marketing tactics get pushed down the action list:

·      “Yes, we need to prepare customer success stories, but this week we need to prep for 5 demos.”

·      “Yes, we need to coordinate an email campaign, but right now we’re focused on this RFP.”

·      “Yes, we need to get out that quarterly newsletter, but these 2 deals need immediate attention.”

·      “Yes, we need to prepare a webinar for prospective customers, but today we need to [ fill in an urgent item of your choice here.]

Don’t let another year go by

I get it: you’ve got lots of stuff on your plate.

And implementing effective marketing plans takes a sustained commitment.  It doesn’t happen by itself, and there’s no magic, one-time fix. (See “Going viral is over-rated”) 

If you’re serious about growth, spend the time and spend the money it takes to cost-effectively acquire and keep customers.  According to a survey of 378 privately-held SaaS companies, the fastest growing companies spent the most on customer acquisition, and marketing accounted for at least 30% of those costs.   

So, if you’re putting your plans together for next year, now’s the time to commit to marketing.  Not just the planning, but also the doing.  Find resources within your company, bring on new people, or use outside experts. 

I don’t mean to scold you here, but a year from now, you don’t want to look back and regret that you’ve made no real progress.  Start with a marketing plan and then put it into action.

Marketing Ideas that Rarely Work

Lead gen, lead gen, lead gen.  For lots of SaaS marketers, these are their top 3 priorities. 

They’re under pressure to deliver leads to feed the sales pipeline… every week, every month, every  

quarter.

So, I understand the temptation to try find a shortcut to lead generation – a quick and easy way to deliver on the quota. 

Resist the temptation.

Any advice you get that points you toward some quick and easy way to deliver leads… ignore it.  (See "Why I'm not a fan of marketing hacks.")

Here’s a few of the ideas that are likely to tempt you.

The magic bullet:  Under this scheme, you search for the one perfect marketing tactic, guaranteed to open the floodgate to qualified leads.  It means building the one viral video, finding the can’t-miss email list, hosting the perfect webinar, or going to the one event guaranteed to put you in front of all of your hottest prospects. 

I’ve seen all of these tactics and even tried a few myself.  They do not work.

Or to be more specific, they do not work all by themselves. 

When you’re selling a B2B solution, you typically need to reach a prospect several times through a variety of channels.  (See “Sometimes prospects just aren’t ready to buy.”)  One touch, no matter how clever, won’t do it.

Set it and forget it:  You cannot put your lead gen efforts on auto-pilot.  Tactics that are working for you now probably won’t work forever. 

Sometimes competitors may interrupt you.  For example, they’ll outbid you on particular paid keywords.  Pay-per-click and SEO campaigns need regular attention and fine-tuning.

Other times, prospects stop responding to tactics the same way they used to.  Anybody remember “dimensional mailers” or “business reply cards?”

To quote Tower of Power, “What is hip today may tomorrow be passé.” 

Let the partner do it:  There are times that partnerships can be helpful.  Teaming up with a larger company could help expand your visibility and attract more opportunities. 

But partnerships do not work by themselves.  They require care and feeding.

Imagine you’re partnering with salesforce.com, for example. Though you’re connected to a well-known brand and have access to an impressive menu of sales and marketing resources, you can’t just slap the partner logo on your website and put out a press announcement. 

It’s work to get your company and your solution to stand out among the thousands of other partners in the AppExchange.  It requires effort to get the attention of the salesforce AEs or prospects within this universe.  None of this happens just because you’re a certified partner.

All sizzle, no steak:  This is how I describe a lead gen process that's all about tactics and nothing about a message or value proposition.  One program follows another to get in front of potential prospects, and most of the focus is on efficient execution. 

But without an effective message, you probably won’t have much impact.  Prospects need to know who the solution is for, what problem it solves, and why they should buy it from you.  If the marketing programs don’t deliver answers to those questions, expect them to fail.  (See “Spend first, think later:  Bad idea.”)

We’ve all seen email campaigns, highly-produced videos, or free trial offers that invite people to evaluate a solution, but they don’t give a compelling reason why.

Before you spend lots of time and money on marketing programs, develop a compelling and consistent value proposition.

I’ve been marketing technology solutions for a long time, so I get it.  There’s pressure to deliver leads.  Sometimes your compensation even depends on it.  But avoid jumping in on an easy fix.  It may sound tempting, but it rarely works.